Multiple Choice
NOPAT is used for 'income' in the return on investment formula because
A) investment center managers should not be evaluated based on long-term financing decisions since they do not have responsibility for making those decisions.
B) NOPAT represents the return to stockholders, and divisions are free to issue stock.
C) NOPAT represents the return to debt capital, and division managers generally are free to issue debt needed to acquire new investments.
D) All of these answer choices are correct.
Correct Answer:
Verified
Correct Answer:
Verified
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